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New energy arrangement to help Elmira

The city expects to help its bottom line by cutting its natural gas and electricity costs with a new agreement that Elmira City Council is to vote on Monday.

The city’s energy supply contract with the New York Schools and Municipalities Energy Consortium expires April 30, City Manager Kimberlee Balok Middaugh said. In the meantime, City Chamberlain John Zielinski has been conducting extensive research to identify suppliers at more favorable rates, she said.

Preliminary results of the consortium’s energy bids indicate that Elmira would face a 35 percent increase in electricity costs and a 10 percent increase in natural gas costs, Zielinski told council members Thursday.

However, if the city contracts with the Municipal Electric and Gas Alliance, its natural gas costs would be reduced by 15 percent instead of increasing by 10 percent, and electricity costs would go down by 7 percent instead of going up by 35 percent, he said.

“The added benefit is that MEGA has no additional charges. We pay an annual fee to NYSMET — the bill came just a few weeks ago — just for administration of the account, an additional $20,000 per year,” Zielinski said.

“It’s not that it’s going to be the magic bullet that’s going to save our budget, but it’s going to help us with our energy costs to the tune of 15 percent on gas and 7 percent on electricity,” he said.

“Every little bit helps,” said Councilman Bill Roe, R-1st District.

MEGA solicits bids and then arranges for the lowest responsible bidders to enter into contracts directly with the municipality, Middaugh said. Through MEGA, the city would purchase natural gas from Direct Energy and electricity from Integrys, she said.

Chemung and Tompkins counties and the City of Ithaca all use MEGA, she said.

There would be no change in delivery of natural gas and electricity, which would still be through New York State Electric and Gas, Zielinski said. No decision has been made yet on the length of the agreement, he said, noting they are getting bids for 12, 24 and 36 months.

City Council will vote on enabling the agreement when it meets 7 p.m. Monday on the second floor of Elmira City Council, 317 E. Church St.